Uganda’s ambition to become a regional industrial powerhouse is clear. Through policies such as the National Development Plan III and the Tenfold Growth Strategy, the country has laid out a blueprint to boost production, attract investment, and grow exports.
However, despite strong government commitment and growing interest from investors, Uganda’s industrial growth continues to face headwinds chief among them are persistent infrastructure challenges.
From unreliable electricity to poor road networks and inefficient logistics systems, infrastructure gaps remain one of the biggest constraints to Uganda’s industrial competitiveness both regionally and globally.
Transport Bottlenecks
One of the most pressing challenges is transportation. Uganda’s road network remains underdeveloped, especially in rural areas where most raw materials are sourced.
Industries in regions like Mbale, Lira, and Gulu often struggle to move agricultural produce, minerals, and semi-finished goods efficiently due to pothole-ridden roads and unreliable rural access routes.
Even where roads exist, traffic congestion and long transit times increase the cost of doing business.
Transporting goods from Kampala to border points like Malaba or Busia can take days due to poor road conditions and slow border processes, affecting supply chains and time-sensitive exports.
These delays reduce Uganda’s appeal to manufacturers seeking faster and cheaper ways to get products to market.
Efforts to address this are underway. The Uganda National Roads Authority (UNRA) is actively upgrading major trunk roads and industrial access roads, including those leading to Namanve and Soroti Industrial Parks. But progress is uneven, and local access roads in secondary towns still lag behind.
Unstable Power Supply Disrupts Production
Electricity remains a major bottleneck for Uganda’s industrialization agenda. While the country has made significant strides in energy generation with large projects like Karuma and Isimba hydropower dams distribution remains unreliable.
Many industrial zones still experience frequent outages, voltage fluctuations, and unexpected shutdowns.
This instability forces manufacturers to rely heavily on diesel-powered generators, raising operational costs and reducing profit margins. The impact is especially felt by SMEs and agro-processors who cannot afford backup power systems, leading to production losses and damaged equipment.
To respond, the government is working to expand the national grid and improve power reliability in industrial parks.
Through partnerships with power distributors like UEDCL, dedicated substations are being set up in key manufacturing zones.
However, the pace of reform remains slow, and connection costs for new factories are still considered high by most investors.
Logistics and Customs Delays Erode Regional Advantage
As a landlocked country, Uganda’s ability to compete in international and regional trade depends heavily on efficient logistics and cross-border facilitation.
Unfortunately, the country still faces inefficiencies at ports, borders, and in warehousing infrastructure.
Imports and exports passing through the Port of Mombasa, for example, are frequently delayed by congestion and paperwork.
Inland container depots and storage facilities, especially those serving industrial parks, are not yet fully developed or automated.
At border points like Malaba and Elegu, trucks can wait for over 48 hours due to customs bottlenecks, limited staff, or technical downtime.
These delays increase the cost of moving goods, discourage trade partners, and reduce Uganda’s competitiveness in the East African market.
To improve this, Uganda is collaborating with Kenya and Rwanda through the Northern Corridor Integration Projects (NCIP), focusing on trade facilitation, cargo tracking, and electronic clearance systems.
The rollout of the Uganda Electronic Single Window and upgrades to customs infrastructure are part of this push, but a lack of harmonization across agencies still causes gaps.
Industrial Parks Struggle Without Last-Mile Infrastructure
Uganda’s flagship industrial zones, like Namanve, Mbale, and Soroti, were established to attract manufacturers and create jobs.
However, many of these parks still face basic infrastructure deficits, such as unpaved internal roads, incomplete drainage systems, and poor sanitation services. For many prospective investors, this is a red flag.
A manufacturer may receive land allocation in a park but still have to wait months or even years for water and electricity connections.
These delays reduce confidence in Uganda as a manufacturing destination, especially when compared to better-serviced zones in Kenya, Rwanda, or Ethiopia.
The Uganda Investment Authority (UIA), which oversees industrial parks, has acknowledged these concerns and is now working with development partners to fast-track infrastructure development in priority parks.
Funding remains a challenge, and coordination among government agencies is often slow.
What Needs to Be Done
For Uganda to fully unlock its industrial potential, a deliberate and well-coordinated infrastructure strategy is essential.
This includes scaling up investment in rural feeder roads, expanding and modernizing electricity distribution, and digitalizing logistics and customs systems to cut trade costs.
Incentives and funding mechanisms, such as public-private partnerships (PPPs), concessional loans, and infrastructure bonds could help bridge financing gaps.
Just as important is the need for stronger institutional coordination to ensure that industrial zones are developed with water, power, roads, and digital connectivity in place from the outset.
Investing in infrastructure not only boosts the competitiveness of Uganda’s industries, but also creates jobs, strengthens domestic supply chains, and enhances the country’s regional trade position. Without it, the dream of becoming a manufacturing hub will remain a distant vision.
Uganda is at a critical crossroads. While the policy ambition for industrialization is clear, infrastructure gaps in transport, energy, and logistics remain a major drag.
Addressing these gaps must become a top priority not just for government, but for the private sector and development partners alike. Only then can Uganda shift from promise to performance in the race to industrial competitiveness.
